July 23, 2024

Human Resource Management – definition objective importance significance scope

Human resource management (HRM) introduction

Human resource management (HRM) is concerned with the ‘people’ dimension in management. HRM is a term increasingly used to refer to the philosophy, policies, procedures and practices relating to the management of people within organizations. Since every organization is made up of people, acquiring their services, developing their skills, motivating them to higher levels of performance, and ensuring that they continue to maintain their
commitment to the organization are essential to achieving organizational objectives. Those organizations that are able to acquire, develop, stimulate and keep outstanding workers will be both effective and efficient. Those organizations that are ineffective or inefficient risk stagnation or going out of business. Human resource management thus, creates organizations and makes them survive and prosper. If human resources are neglected or mismanaged, the organization is unlikely to do well.

Definitions of HRM

According to Ivancevich and Glucck, “Human resource management is the function performed in organizations that facilitates the most effective use of people (employees) to achieve organizational and individual goals”.

Byars and Rue say that “Human resource management encompasses those activities designed to provide for and coordinate the human resources of an organization”.

According to Dale Yoder “the management of human resources is viewed as a system in which participants seek to attain both individual and group goals”.

According to Flippo, HRM is “the planning, organizing, directing and controlling of the procurement development, compensation, integration, maintenance and reproduction of human resources-to the end that individual, organizational and societal objectives are accomplished”.

In the words of Michael J Jucious, Human Resource Management “may be defined as that field of management which has to do with planning, organizing and controlling the functions of procuring, developing, maintaining and utilising a labour force, such that the (a) objectives for which the company is established are attained economically and effectively, (b) objectives of all levels of personnel are served to the highest possible degree; (c) objectives of society are duly considered and served”.

Objectives of Human Resource Management

(a)          To improve the service rendered by the enterprise through building better employee morale, which leads to more efficient individual and group performance. Thus, HRM seeks to manage change to the mutual advantage of individuals, groups, the organization and society.

(b)          To establish in the minds of those associated with the enterprise — employees, shareholders, creditors, customers and the public at large — the fact that the enterprise is rendering the best service of which it is capable and distributing the benefits derived from there fairly and contributing to the success of the enterprise.

(c)           To create and utilise an able and motivated work force, to accomplish the basic organizational goals.

(d)          To recognise and satisfy individual and group needs by providing adequate and equitable  wages, incentives, employee benefits, social security, challenging work, prestige, recognition, security, status etc. Thus an organization can identify and satisfy individual and group goals by offering appropriate monetary and non-monetary incentives.

(e)          To employ the skills and knowledge of employees efficiently and effectively i.e., to utilise human resources effectively in the achievement of organizational goals.

(f) To strengthen and appreciate the human assets continuously by providing training and developmental programmes. Training and development helps the organization attain its goals by providing well-trained and well-motivated employees.

(g) To maintain high employee morale and sound human relations by sustaining and
improving the various conditions and facilities.

(h) To enhance job satisfaction and self-actualisation of employees by encouraging and assisting every employee to realise his full potential.

(i) To provide facilities and conditions of work and creation of favourable atmosphere for maintaining stability of employment.

(j) To recognise and satisfy individual needs and group goals by offering appropriate monetary and non-monetary incentives.

(k) To develop and maintain a quality of work life (QWL) which makes employment in organization a desirable personal and social situation.

Scope of HRM

The scope of Personnel Management is indeed vast. All major activities in the working life of an employee — from the time of his entry into an organization until he leaves the organization come under the purview of Personnel Management. Figure 1.1 explains the vast scope of personnel management.

Human Resource Management embraces a very wide field of activities. The scope of HRM is so wide and varied that the HR department and the personnel executives typically perform a variety of roles in accordance with the needs of a situation. The HR manager plays multiple roles like that of a researcher, of a counsellor, of a bargainer, of a mediator, of a peacemaker, of a problem solver, etc. The functional areas of Human Resource Management
as outlined by Northcott are: (a) Employment; (b) Selection and Training; (c) Employee Services; (d) Wages; (e) Industrial Relations; (0 Health and Safety; and (g) Education.


It has therefore, been rightly observed by Peter Drucker that “Management is a multipurpose organ, which has three jobs, two of which are directly related to personnel: managing a business; managing managers: and managing workers and the work”. The personnel executives play an important role in a business organization. They not only help in determining the rules of the organization, but also play a powerful role in interpreting and applying the rules of the system itself. They are expected to enjoy the confidence of both the management and the workers which is crucial to the efficient and effective operation of the business organization. The focus of human resource management is on people at work. It is indeed a wide area and covers a broad spectrum of activities. A manager, whether he is in charge of a production or a marketing function, deals with human beings and gets his job done through and with people.

Importance / Significance of Human Resource Management

Human resources, along with financial and material resources contribute to the production of goods and services in an organization. Physical and monetary resources, by themselves, cannot improve efficiency or contribute to an increased rate of return on investment. It is through the combined and concerted efforts of people that monetary and material resources are harnessed to achieve organizational goals. But these efforts, attitudes and skills have to be sharpened from time to time to optimise the effectiveness of human resources and to enable them to meet greater challenges. This is where HRM plays a crucial role. The significance of HRM can be discussed at four levels:

(a) Corporate  (b) Professional   (c)  Social (d) National  (a) Corporate

(a) Corporate

Good human resource practices  help in attracting and retaining the best people in the organization. Planning alerts the company to the types of people it will need in short, medium and long run. HRM can help an enterprise in achieving its goal  more efficiently and effectively in the following ways:

  • Attracting and retaining talent through effective human resource planning, recruitment, selection, compensation and promotion policies;
  • Developing the necessary skills and right attitudes among the employees through training;
  • Securing cooperation, of employees through motivation; and
  • Effectively utilising the available human resources.

(b) Professional

Effective management of human resource helps to improve the quality of work life. It contributes to professional growth in the following ways:

  • Providing maximum opportunities of personal development of each employee; Allocating work properly and scientifically; and Maintaining healthy relationships between individuals and groups in the organization.

(C) Social

Sound human resource management has a great significance for society. Society, as a whole is the major beneficiary of good human resource practices.
Employment opportunities multiply.

  • Scarce talents are put to best use.
  • Organizations that pay and treat people well, are always ahead of others and deliver excellent results.
  • Maintain a balance between the jobs available and job seekers in terms of numbers, qualifications, needs and aptitudes.
  • Provides suitable employment that gives social and psychological satisfaction to people.

(d) National

Human resources and their management plays a vital role in the development of a nation. There are wide differences in development between countries with similar resources due to differences in the quality of their people. Development of a country depends primarily on the skills, attitudes and values of its human resources. Effective management of human resources helps to speed up the process of economic growth which in turn leads to higher standards of living and fuller employment.


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